The planned development in York Street will be the largest the city centre has seen since that |of Victoria Square.

Sir Reg said: “The development will bring many benefits beyond the university and will be a welcome boost for our currently beleaguered construction industry.”

The UU unveiled its plans for a major expansion of its Belfast campus last year, which would mean the relocation of many courses from Jordanstown to Belfast. The overall cost of the development is around £250m and construction of the new centre should be complete by 2018.

Sir Reg added: “The new campus will also bring social benefits. One of my department's key goals is to widen participation in higher education, especially among communities which traditionally have tended not to believe university is for them.”

UU Vice Chancellor Professor Richard Barnett welcomed the promise of more cash. “This commitment has been made following a detailed and comprehensive review of the university’s economic appraisal for the Greater Belfast campus by both the Department for Employment and Learning and the Department of Finance and Personnel.

“This marks another important milestone in the development of a new Greater Belfast campus,” he said.

“This is not only good news for higher education. The new campus we are developing will play a significant role in the academic, cultural, social and economic regeneration of the city of Belfast.

“The relocation of 12,000 students from our Jordanstown campus to join the 2,000 students currently studying in York Street will not only boost the city centre, but will also link in well with other exciting developments across the city including the opening up of Belfast’s cultural offering in the Cathedral Quarter, the Gaeltacht Quarter and Titanic Quarter.

“The educational, economic and cultural benefits should ripple right throughout the province.”